2005 Management Compensation Plan Description for CEO and Officers

Summary

This document outlines the 2005 compensation plan for the CEO and officers of the company. Compensation consists of base salary, short-term incentives tied to company performance metrics (customer service and shareholder value), and long-term incentives for future performance. The plan aims to align officer pay with industry benchmarks, targeting the 40th to 50th percentile of compensation at comparable companies if performance targets are met.

EX-10.D.79 12 mgmtcompplandescription05.txt EXHIBIT 10.D.79 2005 MANAGEMENT COMPENSATION PLAN DESCRIPTION CEO and officer compensation includes three components: Base salary is intended to be set at approximately the 50th percentile for base salary compensation at comparable companies. Short-term incentive compensation is intended to compensate officers for Company performance and is linked to defined Company performance metrics, such that if performance targets are achieved, officers' direct compensation (base salary plus short-term incentive) would approximate the 40 -50th percentile of total direct compensation at comparable companies. Performance metrics for short-term incentive compensation include customer service (60%), based on seventeen specified customer service quality performance standards in the Company's service quality plan approved by the Vermont Public Service Board, and creating value for shareholders (40%), based on the Company's annual consolidated return on equity. Long-term incentive compensation is designed to provide long-term incentives for future Company performance and is intended to bring total officer compensation to approximately the 40th percentile of total compensation paid to equivalent executives at comparable companies, if target performance criteria are met.